Technology | Media | Telecommunications

Friday, June 20, 2014

How to Target the Smartphone Early Adopter Segment

American smartphone buyers are quickly adopting device "early upgrade" plans offered by their mobile service providers. Upgrade plan enrollment has more than quadrupled since September 2013 -- going from 7 to 31 percent by the end of the first quarter (Q1) 2014, according to the latest market study by NPD.

The rapid acceptance of these new plans can be attributed to the awareness among some mobile phone owners. Overall, 73 percent of mobile phone owners who were asked if they were aware of the early upgrade plans being offered confirmed their awareness -- with about half of these people being "very aware."

"As one might expect, older consumers are less interested in frequently upgrading their phones; but, surprisingly, Android smartphone owners are as interested in upgrading as their iPhone counterparts," said Stephen Baker, vice president at The NPD Group.

In fact, 22 percent of Android and 25 percent of Apple owners are extremely interested in upgrading their phone more frequently.

Keeping up with the latest technology was cited by 84 percent of smartphone owners as the most influential reason why they signed up for an early upgrade plan. Money was next on the owner's mind, with 62 percent saying being able to finance the phone in monthly installments influenced their decision.

There are also many smartphone owners who are perfectly happy with their device. Thirty-two percent were simply not interested in upgrading, 25 percent said they were unaware of the plans, and 19 percent said the sales associate never mentioned the possibility.

NPD found that a significant number of potential buyers did not receive any information, or properly understand these plans at the point-of-sale. Mobile service providers could potentially add to the success of these new plans by addressing these basic marketing and sales issues.

Identifying and targeting the early adopters of new smartphone technology should be a high priority at service providers, since these people could be key influencers within the marketplace. However, most U.S. carriers are apparently uninterested in effectively pursuing a segmented approach to market development.